Refer to the graphs of D and MR for a monopolist. Which of the following statements is true?
A)A price cut from P₁ to P₂ would lead to a decrease in the amount of dollars consumers spend on the product.
B)A price cut from P₁ to P₂ would lead to an increase in the amount of dollars consumers spend on the product.
C)A price cut from P₂ to P₃ would lead to no change in the amount of dollars consumers spend on the product.
D)A price cut from P₂ to P₃ would lead to an increase in the amount of dollars consumers spend on the product.

Question

Refer to the graphs of D and MR for a monopolist. Which of the following statements is true?
A)A price cut from P₁ to P₂ would lead to a decrease in the amount of dollars consumers spend on the product. 
B)A price cut from P₁ to P₂ would lead to an increase in the amount of dollars consumers spend on the product. 
C)A price cut from P₂ to P₃ would lead to no change in the amount of dollars consumers spend on the product. 
D)A price cut from P₂ to P₃ would lead to an increase in the amount of dollars consumers spend on the product.

Quizplus · Accepted Answer

The Answer of  Refer to the graphs of D and MR for a monopolist. Which of the following statements is true?
A)A price cut from P₁ to P₂ would lead to a decrease in the amount of dollars consumers spend on the product. 
B)A price cut from P₁ to P₂ would lead to an increase in the amount of dollars consumers spend on the product. 
C)A price cut from P₂ to P₃ would lead to no change in the amount of dollars consumers spend on the product. 
D)A price cut from P₂ to P₃ would lead to an increase in the amount of dollars consumers spend on the product.

Refer to the Graphs of D and MR for a Monopolist